Bill would cut Iran's oil exports by another 1 million barrels per day over a year; awaits Senate, president's approval

Reuters|Published: 01.08.13 , 09:00

The House of Representatives easily passed a bill on Wednesday to tighten sanctions
on Iran, showing a strong message to Tehran over its disputed nuclear program days before President-elect Hassan Rohani
is sworn in.

The vote also highlighted a growing divide between Congress
and the Obama
administration on Iran
policy ahead of international talks on the nuclear program in coming months. Iran insists the nuclear program is purely for civilian purposes.

The bill, which passed 400 to 20, would cut Iran's oil exports by another 1 million barrels per day over a year, in an attempt to reduce the flow of funds to the nuclear program. It is the first sanctions bill to put a number on exactly how much Iran's oil exports would be cut.

Russia criticized the vote, saying it would not help resolve the dispute over Tehran's nuclear program.

"Additional sanctions are actually aimed at the economic strangulation of Iran, but not at solving the problem of non-proliferation," Deputy Foreign Minister Gennady Gatilov was quoted as saying by the Interfax news agency.

Previous US and EU sanctions have reduced Iran's oil exports by more than half. The United States has worked with Iran's top oil consumers including China, Japan and South Korea to push them toward alternative suppliers of crude.

Oil prices have remained relatively steady, which has allowed the efforts to continue, but some analysts say further sanctions risk pushing up prices and damaging the economies of US allies.

The bill still has to be passed in the Senate and signed by President Barack Obama before becoming law. The Senate Banking Committee is expected to introduce a similar measure in September, though it is uncertain whether the language to cut exports by 1 million barrels a day will survive.

Critics of the bill said it shows an aggressive signal to Iran that last month voted in Rohani, a cleric many see as more moderate. He will be sworn in on Sunday.

No higher priority

Rep. Ed Royce, a California Republican and Chairman of the House Foreign Affairs Committee who introduced the bill with Rep. Eliot Engel, a New York Democrat, said the United States has no higher national security priority than preventing a nuclear-armed Iran.

Royce said the Supreme Leader Ayatollah Ali Khamenei's drive to develop a nuclear arsenal was evident. "New president or not, I am convinced that Iran's Supreme Leader intends to continue on this path," he said.

The vote showed a growing disagreement between the White House and Congress on Iran policy. A senior administration official said on Wednesday the White House is not opposed to new sanctions in principle, but wants to give Rohani a chance.

The Treasury Department last week partially eased sanctions on Iran by expanding a list of medical devices that can be exported there without special permission.

One of the 20 lawmakers to vote against the bill, Jim McDermott, a Washington-state Democrat, said shortly before the vote that the rush to sanction Iran before Rohani takes office could hurt efforts to deflate the nuclear issue.

"It's a dangerous sign to send and it limits our ability to find a diplomatic solution to nuclear arms in Iran," McDermott said.

A supporter of harsher sanctions disagreed. Ayatollah Ali Khamenei "doesn't see our flexibility and good faith efforts as a sign of good intentions, he sees it as a sign of weakness," said Mark Dubowitz, the head of Foundation of Defense of Democracies, an advocate of sanctions. "If anything, it's only going to be massively intensified sanctions that get him to blink."

But Trita Parsi, the president of the National Iranian American council, said the House action undermines the US strategy which has long been one of good cop - bad cop. The White House has long taken a softer stance toward Iran's nuclear program, and Congress has taken a tougher one. But now there are signs that the good cop cannot control the bad cop, he said.

"The impression on the Iranian side is not that its good cop bad cop, but complete chaos and mayhem," Parsi said.

The bill also further denies Iran governments access to foreign currency reserves, and targets Iranian efforts to circumvent international sanctions against its shipping business.